Critics question apartment proposal for Fairfield Metro site

One of the slides shown Tuesday night that depicts what the Metro Center project would look like if fully built out by Blackrock Realty, which sponsored the forum. FAIRFIELD CITIZEN, CT 1/15/13

One of the slides shown Tuesday night that depicts what the Metro Center project would look like if fully built out by Blackrock Realty, which sponsored the forum. FAIRFIELD CITIZEN, CT 1/15/13

Photo: Andrew Brophy

Photo: Andrew Brophy

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One of the slides shown Tuesday night that depicts what the Metro Center project would look like if fully built out by Blackrock Realty, which sponsored the forum. FAIRFIELD CITIZEN, CT 1/15/13

One of the slides shown Tuesday night that depicts what the Metro Center project would look like if fully built out by Blackrock Realty, which sponsored the forum. FAIRFIELD CITIZEN, CT 1/15/13

Photo: Andrew Brophy

Critics question apartment proposal for Fairfield Metro site

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The developer of the Fairfield Metro Center faced a few sharp questions Tuesday night over his plan to build a 197-unit apartment building near the town's third train station.

The proposed 200,000-square-foot apartment building, which was not part of the original development plan for the 35-acre property off lower Black Rock Turnpike, requires approval from the Town Plan and Zoning Commission. It would replace a 30,000-square-foot retail building initially proposed for the developer's share of the Fairfield Metro project, but it would still have the same footprint.

Kurt Wittek, a managing director and principal at Blackrock Realty, LLC, told roughly 50 people at the forum he sponsored at Fairfield University's Quick Center that he couldn't obtain financing of $75 million to build any of the four office buildings planned on the site without signed leases, and there is no current demand for office and commercial space. He said commercial landlords are lowering rent and making concessions to keep the tenants they now have.

However, Wittek said he could obtain financing of about $52 million to build the apartment building because of the certainty that it would be rented.

"The world is coming out of the recession. We're trying to respond to realities of today's marketplace," he said. "There's a real market for the residential right now. There is no market for commercial right now." "If your position is you want nothing and are willing to pay tax rates accordingly, it's a moot point," he said.

Wittek said the apartment building, which would have 131 one-bedroom units and 66 two-bedroom units, would generate from $800,000 to $1 million in annual tax revenue to the town, based on an assessment of $40 million to $50 million and the town's current tax rate of 23.37 mills.

He estimated the apartments would likely be home to families with about 20 school-age children, which would cost taxpayers up to $240,000 a year based on the town spending $12,000 a year to educate a student. He said his prediction of the number of school-age children came from a study by the state Department of Economic and Community Development that projects that two-bedroom apartments have .07 school-age children per unit. He said no data was provided for school-age children in one-bedroom units because the "incidence was so de minimis."

"Market-rate luxury or new construction rental housing simply does not attract school-age children in any number close to what the naysayers would want you to believe," Wittek said. He said the proposed building would include a swimming pool and gym and that rent would be about $30 a square foot, or $2,500 a month for a 1,000-square-foot unit. He said 20 apartments, or 10 percent of the total, would be rented at "affordable" rates as required by town regulations.

Several members of the audience were concerned that Blackrock would undercut residential landlords by drawing empty nesters and young professionals into the apartment building and creating a vacuum that would be filled by out-of-town residents who want to send their children to Fairfield schools.

But Wittek said he didn't think comparing a four-bedroom rental home to an apartment building with one- or two-bedroom units is a fair comparison. John Fallon, Blackrock's land-use lawyer, disputed the premise, saying that empty nesters are leaving town, while young professionals have been moving to Stamford, Greenwich and Darien.

Kathryn Braun, a member of the Representative Town Meeting, said she had heard that the proposed 2013-14 town budget would increase $17 million, $9 million of which was due to education spending, and that the estimate of 20 addition school children might be low because people want to move into Fairfield because of how much the town spends on education.

Braun said the town had to bond an extra $7 million for public improvements on the Fairfield Metro property and essentially gave up parking revenue from the rail commuter lot because of the amended agreement among the town, state Department of Transportation and Blackrock Realty that was caused by Blackrock's financial problems. She added that the state spent an extra $20 million under that agreement to facilitate completion of the railroad station and parking lot.

Town officials, she added, had been told by the developer that his share of the project would never include residential space.

"It's my belief it will be a net budgetary drain and that enough concessions have been made," Braun said. "It's presumptuous to ask us to approve 197 apartments when there is no commitment to build office or commercial."

However, Ken Camarro, of Carroll Road, said, "There's a lot of water that's gone over the dam. There's nothing that can be done about it. It's history."

"We have got to pull for Fairfield. We have got to make this a golden place," he added.

Wittek said he didn't believe the town would be making concessions by agreeing to a change in the plans to accommodate the apartment building. In addition to generating tax revenue, Wittek said the apartments would "add vibrancy and vitality" to Fairfield and that young professionals want to live where "something is going on and happening."

He said Fairfield would face stagnation and rising taxes for homeowners if it closed its borders.

Fallon said the apartment building could be a "jumpstart" to building out the rest of the mixed-use development envisioned by Blackrock Realty. "If you get could get the residential component up and running, then you're going to have a better chance of being that kind of location a corporate tenant will look to," he said.

Wittek said the apartment building would take about 18 months to build and would generate less traffic than the retail building originally planned in that spot.

Fallon said the environmental cleanup on the former foundry site, which involved removing PCBs and capping casting sand with asphalt, does not preclude residential construction. "There is no environmental land-use restriction. The property was not cleaned to some compromised level that would exclude residential," he said.

The new Fairfield Metro train station doesn't have a waiting room or rest rooms for rail commuters because those were to be housed in a concourse/office building that Blackrock has yet to build. Wittek said Blackrock would be open to building temporary bathrooms as a condition of approval for the apartment building until the concourse/office building could be built.

Several people questioned why the town should agree to the apartment building when Blackrock hadn't built any part of the nearly 1 million square feet of commercial development, which also includes plans to build a hotel.

Wittek said Blackrock tried to find tenants for an office building and was in negotiations with Millard Brown, an advertising agency. The developer said the firm spent $3 million to put in footings and foundations for the office building so construction could quickly begin if a lease was signed. He said Millard Brown, however, later decided to go to a Merritt 7 office building in Norwalk. He said Blackrock also had talked with GE about the possibility of leasing 255,000 square feet, but GE decided to stay at Merritt 7.

On the plus side, Wittek said Time Warner announced it plans to move from 1 million square feet of office space in New York. "Our site is one of the few on their list," he said.

Patricia Ritchie, president and CEO of the Fairfield Chamber of Commerce, said the town desperately needs another hotel, and asked when Blackrock plans to build that. Wittek said Blackrock still has a "valid franchise agreement with Hilton" and that the potential for a hotel is better now than in the past six years.

The proposed development, if fully built out, would generate from $5 million to $6 million a year in taxes to the town, based on assessments of $40 million to $50 million on each of the office buildings and a slightly lower assessment on the hotel, according to Wittek.

Wittek said Blackrock Realty has so far invested $40 million in the Fairfield Metro Center project, and "have not received a dime in return on that investment."

Braun, however, said the value of Blackrock's property had increased substantially because of the train station, an access road through the property from Kings Highway East to Black Rock Turnpike, and the removal and capping of contaminants.

The economy in 2001, when Blackrock Realty bought the 35-acre property at 21 Black Rock Turnpike, was much different than it is today, and Blackrock didn't receive final approvals from land-use agencies to build the development until 2007, shortly before the economy crashed, Wittek said.

"We're still here. We're still investing money. We still believe in this," he said.